LifeMiles Miles & Cash: How Many Should You Buy?

I’ve written in the past about Avianca’s LifeMiles program, which is one of the best frequent flyer programs for redeeming premium cabin Star Alliance award tickets.

Not only do they have reasonable premium cabin redemption rates (especially in comparison to United’s devalued Star Alliance first class award chart), but they also frequently offer lucrative promotions for generating miles. Several times a year they’ll offer a 100% bonus on purchased or shared miles, which is a way to generate miles for 1.5 cents each (though they’ll be increasing the cost of purchased miles by 10% in September).

But one other thing that also makes the LifeMiles program cool is that they’ll let you purchase up to 60% of the miles needed for an award ticket at the time you book your award reservation. So for a 100,000 mile award you really only need 40,000 miles in your account when you go to book, and then can purchase the other 60,000 at the time of ticketing.

Up until last May this was super lucrative, because you could actually purchase 60% of the needed miles at the time of ticketing for as low as 1.275 cents each, which is even cheaper than the cost to purchase miles through a 100% promotion.

They changed the rates last May, however, and now the lowest cost at which you can purchase LifeMiles at the time of ticketing is 1.5 cents each.

What makes this interesting, however, is that the cost to purchase miles is non-linear, and varies between 1.5 and 3.0 cents per mile, depending on how many miles you purchase.

So to keep the math really easy, let’s look at an award that would cost 100,000 miles. In this case, a business class roundtrip between the US and South America.

LifeMiles-Award-Ticket-1
LifeMiles-Award-Ticket-2

Below is a chart with the amount you’d pay per mile if purchasing anywhere between 1,000 and 60,000 miles at the time of ticketing:

# Of Miles PurchasedCostCost Per Mile
1,00030.003.00 cents/mile
2,00060.003.00 cents/mile
3,00090.003.00 cents/mile
4,000120.003.00 cents/mile
5,000150.003.00 cents/mile
6,000176.272.94 cents/mile
7,000200.992.87 cents/mile
8,000224.512.81 cents/mile
9,000246.862.74 cents/mile
10,000268.102.68 cents/mile
11,000288.272.62 cents/mile
12,000307.432.56 cents/mile
13,000325.612.50 cents/mile
14,000342.872.45 cents/mile
15,000359.252.40 cents/mile
16,000374.802.34 cents/mile
17,000389.562.29 cents/mile
18,000403.582.24 cents/mile
19,000416.912.19 cents/mile
20,000429.602.15 cents/mile
21,000441.692.10 cents/mile
22,000453.232.06 cents/mile
23,000464.262.02 cents/mile
24,000474.841.98 cents/mile
25,000485.001.94 cents/mile
26,000494.801.90 cents/mile
27,000504.281.87 cents/mile
28,000513.501.83 cents/mile
29,000522.491.80 cents/mile
30,000531.301.77 cents/mile
31,000539.981.74 cents/mile
32,000548.581.71 cents/mile
33,000557.151.69 cents/mile
34,000565.721.66 cents/mile
35,000574.351.64 cents/mile
36,000583.081.62 cents/mile
37,000591.971.60 cents/mile
38,000601.051.58 cents/mile
39,000610.381.57 cents/mile
40,000620.001.55 cents/mile
41,000629.961.54 cents/mile
42,000640.301.52 cents/mile
43,000651.071.51 cents/mile
44,000662.321.51 cents/mile
45,000675.001.50 cents/mile
46,000690.001.50 cents/mile
47,000705.001.50 cents/mile
48,000720.001.50 cents/mile
49,000735.001.50 cents/mile
50,000750.001.50 cents/mile
51,000765.001.50 cents/mile
52,000780.001.50 cents/mile
53,000795.001.50 cents/mile
54,000811.451.50 cents/mile
55,000831.051.51 cents/mile
56,000851.691.52 cents/mile
57,000873.421.53 cents/mile
58,000896.291.55 cents/mile
59,000920.331.56 cents/mile
60,000945.601.57 cents/mile

As you can see, what’s interesting is that the cost per purchased mile decreased from 3.0 cents per mile to 1.5 cents per mile as you go from 1,000 miles to 45,000 miles. Then it plateaus for a while, and then the cost per purchased mile goes up again, but only slightly.

I totally get why they decrease the cost per purchased mile the more you buy, but it’s interesting that the trend reverses when you max out the number of miles you can purchase.

So looking at the trend, it seems that the LifeMiles “sweet spot” is to purchase 45-53% of the miles needed at the time of ticketing, in order to pay the lowest rate of 1.5 cents per mile. Ultimately if you buy 54-60% of the miles needed at the time of ticketing you don’t come out way behind either, we’re only talking about a difference of 0.07 cents per mile at most.

LifeMiles-Award-Ticket-3

Lastly, keep in mind that if you make a miles & cash booking and later refund it, you’ll be refunded the miles instead of the cash you paid. So making LifeMiles bookings using this method and later refunding them is potentially a way to get around the annual cap on purchased LifeMiles, since miles generated through this method don’t count towards that.

Bottom line

The ideal situation is to purchase 45-53% of the LifeMiles needed at the time of ticketing. However, if you need to purchase 54-60% of the miles needed you won’t come out that far behind either. The key is to avoid purchasing fewer than 45% of the miles needed, as the cost goes as high as 3.0 cents per mile.

(Tip of the hat to Eric)

Comments

  1. Ben – I wonder if it is a percentage based thing or is the cost based on absolute miles. Since you took an example of a ticket with 100K miles, your %age corresponded to absolute number of miles.

    What if the ticket was only 60K miles? The max you can pay for is for 36K miles. Will they cost me 1.62 cents/mile or 1.57 cents/mile – is what one should evaluate!

    I do not have the time to compute that and check, I always pay for the 60% miles 🙂

  2. @ Apu — Have crunched the numbers on multiple types of awards, and this is always the case. The 45-55% range is always cheaper than buying 55%+ miles. But it really isn’t a huge difference either.

  3. ” we’re only talking about a difference of 0.7 cents per mile at most.” should be 0.07 cents per mile.

  4. @ Robbie — They have access to SOME more space than other Star Alliance carriers do, but not nearly as much as they used to.

  5. There are two situations to consider:

    (1) you already have miles in your account (from flying or one of the 2 for 1 promos). In that case, you get the best value out of your miles about the 50% mark (when moving more/less cash either way costs exactly $15)

    (2) and this is the situation with most people coming to LM just to purchase a ticket. The total cost of miles + cash is the lowest by maxing out the cash option, i.e. 60% cash and 40% miles (which is the min miles required for any redemption). If this is your situation, the so-called sweet-spots are completely useless to you.

  6. @Robbie is has nothing to do with LM but how SQ releases premium cabin award seats to partners

    (1) You cannot redeem for SQ in F (with an exception of a few routes on which it works)

    (2) on majority of routes J is released only up to 14 days in advance

  7. @ Scibuff – but, like Lucky mentioned, I thought LM had a little bit more access than most other *A airlines?

  8. Then when you go to buy, PRAY the system accepts your credit card or you will be stuck in a hell that’s nearly impossible to exit. LM actually has 2 employees who do nothing but take your info when you call, tell you to hold, then hang up on you. It ha happened to me so often that Jorge is being outed right here.
    I have had to pay to have a ticket issued by an agent at a $60 fee several times, and thankfully I have an email for a very sweet young lady in Columbia who can take care of problems….when she’s available.

    I agree LM is by FAR the best way to use premium cabins on Star. I’ve even booked and cancelled reservations just to create a few 100k miles.
    I recently booked ANA 3 days in advance first from ORD-TYO-PVG and it did have to be 2 tickets because I was combining first and business.
    There is only one United route I know about where the miles are well below the LM necessary on United. The ANA above was about 100k miles versus 130 using UA.
    I can’t say ebough good things about the program and enough frustrating things about getting credit cards accepted and tickets issued.

  9. May I also suggest that you don’t use the Chrome browser to do any searches on the Lifemiles website.

    Firefox seems to work best.

  10. Laurel and Lucky:

    Lucky was correct in the first place. It is 0.7 cents, which is 7/10 of a cent. Now, the article reads 7/100 of a cent, which is retarded. Even if one thinks in dollar notation, which one should NOT do here, 0.07 dollars would be seven cents.

    Clearly your readers have trouble with elementary school math, Lucky. Maybe you should write 7/10 of a cent, or seven-tenths of a cent. Of course, it is probably all a lost cause.

    Laurel said,

    ” we’re only talking about a difference of 0.7 cents per mile at most.” should be 0.07 cents per mile.

    June 23rd, 2014 at 12:14 pm

    lucky said,

    @ Laurel — Good catch, thank you.

  11. @traderprofit

    It really must depend on your cards and your computer setup. I am in Japan, and the LM site works with every browser(on my Mac), and it accepts my credit cards right off, and electronic ticketing is done in about the same time frame as United does it. I have never had a single malfunction when buying miles on promotion, or when booking an award, and I’ve done five so far. The only tiny thing is that the pull down menus are a bit slow to react on the search page.

    “I can’t say enough good things about the program and enough frustrating things about getting credit cards accepted and tickets issued.”

  12. Just wondering if the miles and cash rate will be impacted by the 10% increase for the purchasing of miles in Sep 2014?

  13. Thanks for the tip Ben!
    I have used Lifemiles and it is a 50/50 experience. some Star Alliance partner flights that show up on United doesn’t show on Lifemiles, even though the layover is less than 12 hours. I wonder why.
    But apart from not being able to book tickets with layovers of 12 hours, and mixed cabin (unless you ticket them separately and pay more miles) it is a decent system.
    And I didn’t know about the cancellation policy were they re-credit your in the miles! awesome! thanks for that tip.

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